Toast the arbol peppers in a dry skillet over medium heat for 1–2 minutes, just until they smell amazing. Don’t burn them — bitter pepper smoke is not the vibe here.
Add the garlic and toast another minute or so, then transfer everything to a blender. If you’re garlic-averse, you can sauté it first, but where’s the fun in that?
Pour in vinegar, water, salt, and sugar or honey. Blend until smooth. If you like it chunkier, pulse a few times instead of blending to a puree.
Heat the olive oil in a small saucepan over medium heat, then pour in the pepper blend. Simmer 5–7 minutes, stirring occasionally. The flavors will marry like a couple at a kitchen dance party.
Cool slightly, then stir in lime juice if you’re using it. Bottle or refrigerate. The flavor will deepen after a day or two, but it’s tasty right away too.